Dow at 11,123, up nine points this morning.
NEW YORK (AP) — Stock wavered Friday after a report on economic
growth did little to reassure investors about the health of the
economy.
The Dow Jones industrial average fell about 20 points in midday
trading.
Gross domestic product, the broadest measure of the nation’s
economy, grew at a 2 percent annual pace in the third quarter. That
was in line with economists’ expectations and only slightly better
than the 1.7 percent growth rate during the second quarter.
Signs of meager growth come as investors grow more cautious heading
into next week’s midterm elections and are uncertain about the size
of economic stimulus measures the Federal Reserve is expected to
announce next week.
Normally such slow GDP growth would have driven stocks much lower.
But signs of weak economic expansion provide further support for
the Fed’s anticipated stimulus plan.
“Because GDP was so lackluster, we don’t see the Fed pumping the
brakes” on its plan, said Tony Zabiegala, a partner at Strategic
Wealth Partners.
Stocks rose sharply during the first half of October as
expectations mounted that the Fed would start buying Treasury bonds
to drive interest rates lower. That, in turn, is supposed to spark
spending and lending. In recent days, however, the size of the
bond-buying program has been questioned, putting a market rally on
hold.
John Apruzzese, a partner and portfolio manager at Evercore Wealth
Management, said reaction in anticipation in the program is typical
of the market.
